Reasons why auditor cant detect financial statement fraud?
can it be due to denial of audit evidence?
Answers:
In doing an audit of financial event, within are lot of things to consider:
a.) expertise of the character doing an audit thus the more complex issue is one audited, one would require an auditor that hold like mad of experience.
b.)Cost benefit concept- is another issue because surrounded by doing the audit the cost to conduct the audit most not be more than the benefit expected otherwise the audit function would be useless. The apology why auditors do statistical sampling and try to application professional judgement on which areas are high-ranking risk , environment risk or low risk and the the amount and time of audit procedures would be depend on the faster mentioned height of risk. Like a petty dosh fund would not merit much time an physical exertion compared to inventory or receivables.
c.)Collusion- is another factor because fraud done by multiple individuals is harder to detect compared to one done by just by one human being.
Even though if an auditor have plenty experience and doing the audit in a professional posture, he cannot be deem infallibe. Auditing is a complex procedure which involve doing some professional judgement base on the audit evidence.
Thus even how flawless a set audit evidence and how experienced the auditor , nearby is still that slim possibility of not detecting a fraud at a given set of time, but sooner or next next to added evidence that could be correlated next to the previous audit report , it would be more imagined that the fraud be uncovered.
mostly it depends on how thoughtful the auditor digs. the evidence other comes out if you verbs gaping satisfactory.
It can be due to a few reason, resembling:
* insufficiency of audit evidence. It have other be said that you can't audit omission. If someone hide invoices in his drawers, you might never know here're underhand liabilities
* closeness. If you've be auditing alike client for years, you leak into what we phone a "comfort zone", and you lose your professional skepticism, which is so noteworthy contained by audit
* collusion. If the CEO and CFO collude and report you alike wrong story, you won't know it's wrong
* forgery. Auditors are not handwriting experts and are not possible to detect forged documents
* sampling is a mandatory factor of audit. Nobody audits 100% of adjectives transactions. They zoom contained by on risk areas and stuff components and contained by doing so, may miss errors
Would you approve an external company to come surrounded by and evaluate where on earth your company stands environmentally?
Is crown financial group a scam?
Internet Career Kit?
SAGE MAS 200 Vs. Microsoft Dynamics GP (Formerly Great Plains)?
I own thought of a appropriate invention?
Answers:
In doing an audit of financial event, within are lot of things to consider:
a.) expertise of the character doing an audit thus the more complex issue is one audited, one would require an auditor that hold like mad of experience.
b.)Cost benefit concept- is another issue because surrounded by doing the audit the cost to conduct the audit most not be more than the benefit expected otherwise the audit function would be useless. The apology why auditors do statistical sampling and try to application professional judgement on which areas are high-ranking risk , environment risk or low risk and the the amount and time of audit procedures would be depend on the faster mentioned height of risk. Like a petty dosh fund would not merit much time an physical exertion compared to inventory or receivables.
c.)Collusion- is another factor because fraud done by multiple individuals is harder to detect compared to one done by just by one human being.
Even though if an auditor have plenty experience and doing the audit in a professional posture, he cannot be deem infallibe. Auditing is a complex procedure which involve doing some professional judgement base on the audit evidence.
Thus even how flawless a set audit evidence and how experienced the auditor , nearby is still that slim possibility of not detecting a fraud at a given set of time, but sooner or next next to added evidence that could be correlated next to the previous audit report , it would be more imagined that the fraud be uncovered.
mostly it depends on how thoughtful the auditor digs. the evidence other comes out if you verbs gaping satisfactory.
It can be due to a few reason, resembling:
* insufficiency of audit evidence. It have other be said that you can't audit omission. If someone hide invoices in his drawers, you might never know here're underhand liabilities
* closeness. If you've be auditing alike client for years, you leak into what we phone a "comfort zone", and you lose your professional skepticism, which is so noteworthy contained by audit
* collusion. If the CEO and CFO collude and report you alike wrong story, you won't know it's wrong
* forgery. Auditors are not handwriting experts and are not possible to detect forged documents
* sampling is a mandatory factor of audit. Nobody audits 100% of adjectives transactions. They zoom contained by on risk areas and stuff components and contained by doing so, may miss errors